The Mesabi Daily News calls it the second blow in a one-two punch against the Iron Range economy.
U.S. Steel Corp. said Thursday that it’s laying off 500 union workers and 90 management employees at its Minntac facility in Mountain Iron.
The company laid off another 300 workers in December at another facility in Keewatin.
The Minntac layoffs represent nearly half the plant’s workforce. The company is calling them temporary layoffs until the steel market improves.
An official at the company’s Pittsburgh headquarters told the Mesabi Daily News that unlike previous recessions, this one blindsided the industry. In October, nationwide steel mills were at 95 percent production. Today, production is at 40 percent.
The marketplace flows downhill. Last summer’s gas prices and the credit “crunch” which followed led to a lack of sales for cars and trucks. Cars and trucks use steel. Nobody buying cars=nobody buying steel=nobody buying iron ore.
Mining of any raw material is by its nature cyclical and the history of the Iron Range shows a fairly steady cycle from boom to bust every 10-15 years since World War II. Prior to that, a different type of ore (hematite, for the most part) was being mined here, and the supply of that has been largely exhausted. Were it not for the invention of the taconite process in 1946, which allows for the use of lower-grade ore, the Iron Range would be a series of ghost towns surrounded by useless holes in the ground.